Help restore trust, ASIC tells brokers

10 September 2018

Insurance brokers caught up in the wider fallout of the Hayne royal commission should stop feeling sorry for themselves and help fix the problem, the Australian Securities and Investments Commission (ASIC) says.

ASIC Senior Executive Leader Financial Advisers Joanna Bird told the National Insurance Brokers Association Convention in Hobart last week there are clear community concerns about the financial services industry’s culture and conduct.

General insurance brokers believe the relatively low number of complaints levelled at them, and the fact that no broking representatives have been called by the commission, proves they are not a key part of the problem. But Ms Bird says they must nevertheless be part of the solution.

“We’ve seen poor conduct in the financial services sector, highlighted by regulators, media attention and, of course, the royal commission,” she said. “I suspect you’re sitting there thinking, ‘it’s not my fault – why am I a victim of this?’

“We all need to get over that feeling of unfairness and collectively work together to try to restore consumers’ trust in the financial services industry.”

Lead Ombudsman General Insurance for the Australian Financial Complaints Authority John Price confirmed the number of complaints against brokers is falling.

“The dispute numbers have dropped – last year we received 181 disputes from brokers, a very small number,” he told the convention. The previous year 216, so down about 16%.

“The year before that the figure was about 250, so it’s been dropping. Of those disputes that get to a decision, 73% are being found in favour of the broker.”